Top Chinese OEM, Xiaomi is planning to introduce its own line of custom-made processors, a series which will go by the name “Pinecone”. The Pinecone is a more powerful chip that is based on the Cortex-A73 cores and will be having a 4 x 4 architectural design. The China-based manufacturer has plans in place to roll out its ‘Pinecone’ microprocessor within a month. This “chip-making” move by Xiaomi makes it the second of its kind from China as Huawei pioneered the custom made chip manufacture process.
It is super glaring that the current happenings and developments in the Chinese smartphone market aren’t taking a good toll on Xiaomi. New OEMs are springing up almost quarterly. And not just that, they are coming with amazing devices that customers are on the look at for – at cheaper prices too. All these factors, and more, combined have made the former market leaders (which had the highest number of smartphone units shipped in China in 2015) slip to fifth place behind other OEMs like Oppo, Huawei, Vivo, and Apple – with Oppo currently toping. Xiaomi is definitely growing through tough times in terms of growth. In a nutshell, the decline in demand, the rise in device price, and fierce competition are all contributing factors.
Going by The Wall Street Journal report, a new Xiaomi-associated private entity, Beijing Pinecone Electronics reportedly paid 103 Million CNY ($15 Million) to a subsidiary of Chinese state-backed Datang Telecom, Leadcore Technology Ltd. to acquire mobile processor technology. It is the two companies (Beijing Pinecone Electronics and Leadcore Technology). However, that will be jointly involved in the mobile chip design and manufacture.
The news of Xiaomi developing its own chips was first brought into light sometime in 2015 when the vice president of processor manufacturer, Leadcore Technology Ltd. announced a partnership with Xiaomi to help it design them.
The move is highly beneficial to Xioami in many ramifications as it would assist in creating a better connection and integration between its hardware and software, as the company is presently sourcing chipsets from Qualcomm and MediaTek only – same as many small and budding OEMs. Developing its own processors hands Xiaomi the chance to diversify its phones, restructure, rebrand, rebirth and make them stand out in the already-saturating Chinese market.
Xiaomi would also of course benefit from this move by cutting total production costs and will very much likely bring reliance on third-parties to a reduced level.